SES TO DEVELOP INTERACTIVE SATELLITE RETURN CHANNEL SES awards contract for Network Hub and Satellite Interactive Terminals (SITs) to NORTEL NETWORKS, PHILIPS, SPAR AEROSPACE and NORTEL-DASA for Turnkey Interactive Satellite Communications System

Société Européenne des Satellites (SES) has signed a 15.75 million ECU contract with Nortel Networks for the provision of a turnkey interactive satellite system. It will consist of the Ground Network as well as Satellite Interactive terminals (SITs) for Europe´s first commercial Ka-band satellite return channel system. The new technology will be integrated seamlessly into SES´ existing ASTRA-NET multimedia platform, in order to provide interactive broadband and bandwidth on demand multimedia services on the upcoming ASTRA 1H and ASTRA 1K satellites. In particular, the satellite return channel will provide a high-speed network to collect multimedia contributions for onward distribution or multicasting to existing and new ASTRA-NET clients and it will provide businesses and consumers with two-way digital communications via the ASTRA Satellite System.

Nortel Networks (NYSE : NT/TSE : NTL) is the prime contractor in a team which comprises Philips Business Electronics B.V. (both also producing SITs), Spar Aerospace Ltd., and Nortel-DASA GmbH & Co. The contract signature took place at SES´ headquarters in Luxembourg on Monday, December 14, 1998.

From early 2000 onwards, when the technology will be commercially available in Western and Central Europe via the ASTRA 1H satellite, ASTRA-NET Service Providers will be able to cost effectively offer services such as fully interactive corporate data networks, broadband access for professionals working at home, remote monitoring, data collection and distribution, corporate training and tele-medicine. With the launch of ASTRA 1K, the service area will be extended in 2001 into Eastern Europe and the C.I.S.

ASTRA-NET utilises Digital Video Broadcast (DVB) technology at Ku-band frequencies to provide customers with multimedia data at speeds of up to 38Mbit/s from the ASTRA Satellite System. The satellite return path will use the new higher frequencies (29.5-30.0 GHz /18.3 - 18.8 GHz) of the Ka-band payloads on the ASTRA 1H and ASTRA 1K satellites.

Each user or group of users will need a Satellite Interactive Terminal (SIT). Using antennae ranging from 60cm to 120cm, a SIT will transmit at speeds from 150 kbit/s to 2Mbit/s respectively as well as receive the full range of ASTRA Ku-band services. A range of low cost two-way Satellite Interactive Terminals will be available at the start of commercial operations, initially from Nortel Networks and Philips, and later from additional manufacturers. Terminal wholesale prices will start at approximately 2000 ECU, with prices expected to decline to approx. 1000 ECU as the market expands.

The ASTRA-NET return channel provides a non-proprietary, open technology platform based upon industry standards (e.g: DVB, ETSI and DAVIC) in order to encourage the development of multiple terminal manufacturers and service providers. SES is also working actively with standardisation bodies and regulatory authorities in order to facilitate an open licensing regime.

According to Dean Olmstead, Director of Business Development of SES: "Adding a satellite return channel to the ASTRA-NET multimedia platform will allow for a powerful new level of interactive broadband services for users across Europe. SES intends to continue leading the market in the distribution of Direct-to-Home and Direct-to-Office services in Europe and beyond as the industry evolves to the next generation of satellite systems."

"The Nortel Networks' portfolio of solutions and experience in the telecommunications and satellite arenas enables us to help our customers, such as SES, meet the increasing demands of today's marketplace through open and standard systems," said Charles Drayton, Vice President, Business Development, Wireless, Nortel Networks. "Our Unified Networks bring advanced solutions to satellite service providers by integrating leading Nortel Networks systems with elements from several technology partners."

Rob Van Oostenbrugge, General Manager of Philips Digital Video Systems, said "This co-operation with SES/ASTRA and Nortel Networks in the newest-technology satellite return channel project highlights the strength of Philips' end-to-end DVB/MPEG capabilities. It enables enhanced two-way multimedia communications to be built by SES/ASTRA, and strengthens our relationship with pioneering companies."

Backgrounders on Nortel Networks, Philips and SES

Nortel Networks leverages a complete portfolio of world-class telecommunications products and services to address the needs of broadband, fixed and mobile satellite service operators.

Nortel Networks works with customers worldwide to design, build, and deliver telecommunications and IP-optimized networks. Customers include public and private enterprises and institutions; Internet service providers; local, long-distance, cellular and PCS communications companies, cable television carriers, and utilities.

Nortel Networks' common shares are listed on the New York, Toronto, Montreal, Vancouver and London stock exchanges. Nortel Networks had 1997 revenues of US$ 15.5 billion and Bay Networks, a wholly owned subsidiary of Nortel Networks, had revenues of US$ 2.4 billion during its most recent fiscal year. The combined company's workforce totals approximately 80,000 employees worldwide. Nortel Networks website is located at www.nortelnetworks.com.

Royal Philips Electronics, of The Netherlands, is one of the world's largest electronics companies, with sales of over US$ 39 billion in 1997. It is a global leader in colour television sets, lighting, home telephony products and electric shavers. Its 264,700 employees in more than 60 countries are active in the area of semiconductors and components, consumer products, professional products and systems, lighting and software and services. Philips is quoted on the NYSE, London, Frankfurt, Amsterdam and other stock exchanges.

News from Philips is located at www.news.philips.com

SES is the operator of ASTRA, the leading European direct-to-home satellite system. As of June 30^th, 1998, of all European households receiving TV by either satellite or cable, more than 73 million (92 per cent) received one or more channels via the ASTRA system. ASTRA now reaches some 44 per cent of all European TV households. ASTRA transmits 98 analogue and 336 digital television channels and more than 360 analogue and digital radio channels over 148 transponders to countries within its European footprint. SES' customer base includes most of the leading public and private broadcasters in Europe, notably the German public broadcasters ARD and ZDF; Canal+ (France); CLT-UFA (Luxembourg); BSkyB (UK); BBC (UK); the Kirch Gruppe (Germany); Sogecable (Spain); Wizja TV (Poland); Turner Broadcasting (USA) and Viacom (USA). The ASTRA Satellite System currently comprises seven geostationary (GEO) satellites at the position of 19.2° East.

In addition, an eighth GEO satellite is permanently operational since October 1, 1998 at SES' second orbital position of 28.2° East to provide satellite digital services in the UK and the Republic of Ireland.

SES expects to be the first European satellite operator to commercially exploit the Ka-band frequency for interactive and multimedia services in Europe. In 2000, SES expects to commence operations of a satellite based return channel, which initially will serve the growing market in Western and Central Europe for 2-way asymmetric, high-speed broadband collection and delivery of multimedia.

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